Flotation costs refer to the:

A) Initial costs incurred on day one of a new project.
B) Interest rate imposed on the firm's debt.
C) Required rate of return which is necessary for a project to be accepted.
D) Dividends which shareholders expect when they purchase shares of the firm's stock.
E) Costs incurred by a firm when new issues of securities are sold.

Flotation Costs

The costs associated with issuing new securities, including underwriting, legal, registration, and other expenses.

Securities

Investment assets that denote a shareholding in a publicly-listed company (stock), a bondholder’s claim against a corporation or government, or ownership rights as outlined in an option contract.

Project Costs

Project Costs include all expenses incurred during the execution of a project, including materials, labor, and overhead.